What's happening
This bill limits the liability of design professionals in public contracts, making them responsible only for their own negligence or misconduct.
Why it matters
Shifts Risk in Public Projects. This bill prevents state and local government contracts from making design professionals (like architects and engineers) liable for defending or indemnifying others for claims unless the professional’s own negligence or misconduct caused the issue. This reduces the amount of legal risk that design professionals bear on public projects.
Limits Insurance and Cost Pressures. By restricting liability to only what is directly caused by the design professional, the bill may lower insurance premiums and overall business costs for these professionals—potentially making it easier for smaller firms to compete for public contracts.
May Impact Public Contract Negotiations. Public entities can no longer demand broad indemnification clauses from design professionals, possibly shifting some legal and financial risks back onto municipalities and public agencies. This could affect how contracts are structured and negotiated in the future.
Encourages Fairer Allocation of Fault. The bill ensures that design professionals are only responsible for damages in proportion to their actual fault, rather than being held liable for the mistakes or negligence of others involved in a project, which could lead to fairer outcomes in disputes and lawsuits.
Albany, before your first meeting.
Every bill that moved yesterday, summarized in a sentence and ranked by impact. The Albany Scorecard follows on Sundays.
Free. Unsubscribe in one click. Want alerts on specific bills? Create an account.
Who cares
Headline styles
Limit Design Professional Liability
Plain English, a few words. Used as the page title.
Sponsors
History
- Referred to local government
- Referred to local government
Full text
3 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
4303
2019-2020 Regular Sessions
IN SENATE
March 7, 2019
Introduced by Sens. RANZENHOFER, AKSHAR, GALLIVAN, JACOBS, ROBACH, SEWARD -- read twice and ordered printed, and when printed to be committed to the Committee on Local Government
AN ACT to amend the general municipal law, the public authorities law and the state finance law, in relation to liability of design professionals
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. The general municipal law is amended by adding a new section 103-h to read as follows:
§ 103-h. Design professional liability. 1. For purposes of this section, the term "design professional" shall mean:
a. An individual licensed pursuant to articles one hundred forty-five, one hundred forty-seven, and one hundred forty-eight of the education law; or
b. Any corporation, limited liability company, partnership or other business entity legally authorized to practice any of the professions regulated by articles one hundred forty-five, one hundred forty-seven, and one hundred forty-eight of the education law.
2. Any provision, clause, covenant, or agreement contained in, collateral to, or affecting a contract executed on or after January first, two thousand twenty between a municipal corporation, as defined in section sixty-six of the general construction law, and a design professional for professional design services related to the design, construction, repair, or maintenance of any public building, structure, highway, bridge, viaduct, water or sewer system, or other public facility that requires a design professional to defend or indemnify such municipal corporation, its agents, contractors, subcontractors or suppliers shall be deemed void and against public policy and wholly unenforceable, except as to claims that are caused by or the result of the negligence, recklessness, or willful misconduct of the design professional. Any
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD07680-01-9
S. 4303 2
contractual obligation permitted under this section shall be limited and enforceable only to the degree or percentage or fault attributable to such design professional.
§ 2. The public authorities law is amended by adding a new section 2879-d to read as follows:
§ 2879-d. Design professional liability. 1. As used in this section:
a. The term "design professional" shall mean:
(1) An individual licensed pursuant to articles one hundred fortyfive, one hundred forty-seven, and one hundred forty-eight of the education law, or
(2) Any corporation, limited liability company, partnership or other business entity legally authorized to practice any of the professions regulated by articles one hundred forty-five, one hundred forty-seven, and one hundred forty-eight of the education law.
b. The term "state authority" shall mean a public authority or public benefit corporation created by or existing under this chapter or any other law of the state of New York, with one or more of its members appointed by the governor or who serve as members by virtue of holding a civil office of the state, other than an interstate or international authority or public benefit corporation, including subsidiaries of such public authority or public benefit corporation.
c. The term "local authority" shall mean: (1) a public authority or public benefit corporation created by or existing under this chapter or any other law of the state of New York whose members do not hold a civil office of the state, are not appointed by the governor or are appointed by the governor specifically upon the recommendation of the local government or governments; (2) a not-for-profit corporation affiliated with, sponsored by, or created by a county, city, town or village government; (3) a local industrial developmental agency or authority or other local public benefit corporation; (4) an affiliate of such local authority; or (5) a land bank corporation created pursuant to article sixteen of the not-for-profit corporation law.
2. Any provision, clause, covenant, or agreement contained in, collateral to, or affecting a contract executed on or after January first, two thousand twenty between a state authority or local authority and a design professional for professional design services related to the design, construction, repair, or maintenance of any public building, structure, highway, bridge, viaduct, water or sewer system, or other public facility that requires a design professional to defend or indemnify such state authority or local authority, its agents, contractors, subcontractors or suppliers shall be deemed void and against public policy and wholly unenforceable, except as to claims that are caused by or the result of the negligence, recklessness, or willful misconduct of the design professional. Any contractual obligation permitted under this section shall be limited and enforceable only to the degree or percentage or fault attributable to such design professional.
§ 3. Section 136-a of the state finance law is amended by adding a new subdivision 6 to read as follows:
6. a. As used in this subdivision:
(1) The term "design professional" shall mean: (i) an individual licensed pursuant to articles one hundred forty-five, one hundred forty-seven, and one hundred forty-eight of the education law; or (ii) any corporation, limited liability company, partnership or other business entity legally authorized to practice any of the professions regulated by articles one hundred forty-five, one hundred forty-seven, and one hundred forty-eight of the education law.
S. 4303 3
(2) The term "state agency" shall mean (i) any state department, (ii) any division, board, commission or bureau of any state department, (iii) the state university of New York and the city university of New York, including all their constituent units, or (iv) a board, a majority of whose members are appointed by the governor or who serve by virtue of being state officers or employees as defined in subparagraph (i), (ii) or (iii) of paragraph (i) of subdivision one of section seventy-three of the public officers law.
b. Any provision, clause, covenant, or agreement contained in, collateral to, or affecting a contract executed on or after January first, two thousand twenty between a state agency and a design professional for professional design services related to the design, construction, repair, or maintenance of any public building, structure, highway, bridge, viaduct, water or sewer system, or other public facility that requires a design professional to defend or indemnify such state agency, its agents, contractors, subcontractors or suppliers shall be deemed void and against public policy and wholly unenforceable, except as to claims that are caused by or the result of the negligence, recklessness, or willful misconduct of the design professional. Any contractual obligation permitted under this section shall be limited and enforceable only to the degree or percentage or fault attributable to such design professional.
§ 4. This act shall take effect on the one hundred eightieth day after it shall have become a law and shall apply to all contracts entered into on and after such date.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the general municipal law, the public authorities law and the state finance law, in relation to liability of design professionals
Purpose of the bill
The bill provides that in contracts for public works, design profes- sionals (engineers, architects and surveyors) may be required to defend an provide indemnification for damages caused by or are the result of their own negligence, recklessness, or willful misconduct, but not for damages that are the responsibility of other parties, and that contract provisions that attempt to expand the defense and indemnification obli- gations of such design professionals to include damages caused by other parties are void and contrary to public policy.
SUMMARY OF SPECIFIC PROVISIONS::
Read the full memo (673 words)
Section 1 amends article 5-A of the General Municipal Law by adding a new § 103-h. The new § 103-h provides that provisions requiring defense and indemnification in contracts involving a public work are void to the extent that a design professional is required to defend and indemnify a political subdivision or other parties for damages that are not the result of the negligence, recklessness, or willful misconduct of the design professional. The amendment more clearly states the objective of this provision.
Section 2 amends the Public Authorities Law by adding a new § 2879-d. The new § 2879-d provides that provisions requiring defense and indemni- fication in contracts involving a public work are void to the extent that a design professional is required to defend and indemnify the public authority or other parties for damages that are not the result of the negligence, recklessness, or willful misconduct of the design professional. The amendment more clearly states the objective of this provision.
Section 3 amends § 136-a of the State Finance Law by adding a new subdi- vision 6. The new subdivision 6 provides that provisions requiring defense and indemnification in contracts involving a public work are void to the extent that a design professional is required to defend and indemnify a State Agency or other parties for damages that are not the result of the negligence, recklessness, or willful misconduct of the design professional. The amendment more clearly states the objective of this provision.
Section 4 provides that the provisions of bill shall take effect imme- diately.
JUSTIFICATION::
State agencies, public authorities and local governments have recently insisted upon the inclusion of broad form indemnification provisions in contracts for public works with design professionals. These provisions require the design professional to defend and indemnify the public project owner for loses related to the actions or failures of other parties that are unrelated to the design professional services and over whom the design professional neither has nor exercises control. Design professionals have little or no ability to negotiate with public owners regarding these provisions. In fact, the public owner can dictate contract terms of this type. The design professionals' only options are to assume the risks related to these provisions or walk away from the contract.
These broad form defense and indemnification provisions subject the design professionals to liability for services that are well beyond the design professionals' contractual scope of work and for matters over which the design professional has no control.
Design professionals are unable to secure insurance to cover the scope of claims these provisions can generate. Hence, the demands for defense and indemnification costs beyond the scope of the design professionals' contractual scope of work may be illusory. This is particularly the case in instances when the public owner tenders a demand on the design professional for the provision of defense costs for claims unrelated to design professionals' work.
Design professionals understand and expect that they will be responsible for damages that are the result of their own negligence, recklessness, or willful misconduct, but not for provision of defense costs and the payment of damages that are the responsibility of other parties.
PRIOR LEGISLATIVE HISTORY:: 2017 - S.6622/A.8293 - RULES/Rules 2018 - S.6622-A/A.8293-A - P.S.-VETOED/P.S.-Vetoed
FISCAL IMPLICATIONS::
None.
EFFECTIVE DATE::
The bill shall take effect immediately.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.